Correlation Between Shaanxi Construction and Chinese Universe
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By analyzing existing cross correlation between Shaanxi Construction Machinery and Chinese Universe Publishing, you can compare the effects of market volatilities on Shaanxi Construction and Chinese Universe and check how they will diversify away market risk if combined in the same portfolio for a given time horizon. You can also utilize pair trading strategies of matching a long position in Shaanxi Construction with a short position of Chinese Universe. Check out your portfolio center. Please also check ongoing floating volatility patterns of Shaanxi Construction and Chinese Universe.
Diversification Opportunities for Shaanxi Construction and Chinese Universe
-0.28 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Shaanxi and Chinese is -0.28. Overlapping area represents the amount of risk that can be diversified away by holding Shaanxi Construction Machinery and Chinese Universe Publishing in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Chinese Universe Pub and Shaanxi Construction is a relative statistical measure of the degree to which these equity instruments tend to move together. The correlation coefficient measures the extent to which returns on Shaanxi Construction Machinery are associated (or correlated) with Chinese Universe. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Chinese Universe Pub has no effect on the direction of Shaanxi Construction i.e., Shaanxi Construction and Chinese Universe go up and down completely randomly.
Pair Corralation between Shaanxi Construction and Chinese Universe
Assuming the 90 days trading horizon Shaanxi Construction Machinery is expected to generate 1.59 times more return on investment than Chinese Universe. However, Shaanxi Construction is 1.59 times more volatile than Chinese Universe Publishing. It trades about 0.03 of its potential returns per unit of risk. Chinese Universe Publishing is currently generating about -0.29 per unit of risk. If you would invest 336.00 in Shaanxi Construction Machinery on August 29, 2024 and sell it today you would earn a total of 2.00 from holding Shaanxi Construction Machinery or generate 0.6% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Shaanxi Construction Machinery vs. Chinese Universe Publishing
Performance |
| Timeline |
| Shaanxi Construction |
| Chinese Universe Pub |
Shaanxi Construction and Chinese Universe Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Shaanxi Construction and Chinese Universe
The main advantage of trading using opposite Shaanxi Construction and Chinese Universe positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Shaanxi Construction position performs unexpectedly, Chinese Universe can make up some of the losses. Pair trading also minimizes risk from directional movements in the market. For example, if an entire industry or sector drops because of unexpected headlines, the short position in Chinese Universe will offset losses from the drop in Chinese Universe's long position.| Shaanxi Construction vs. Cambricon Technologies Corp | Shaanxi Construction vs. Loongson Technology Corp | Shaanxi Construction vs. Chongqing Road Bridge | Shaanxi Construction vs. Shenzhen Fortune Trend |
| Chinese Universe vs. China State Construction | Chinese Universe vs. Huafa Industrial Co | Chinese Universe vs. China International Capital | Chinese Universe vs. Kweichow Moutai Co |
Check out your portfolio center.Note that this page's information should be used as a complementary analysis to find the right mix of equity instruments to add to your existing portfolios or create a brand new portfolio. You can also try the Price Ceiling Movement module to calculate and plot Price Ceiling Movement for different equity instruments.
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